Singapore's central bank unexpectedly keeps policy unchanged, lowers inflation forecast.

Singapore's central bank unexpectedly kept monetary policy unchanged, anticipating that global energy tensions and the demand boom driven by artificial intelligence will cool next year. The Monetary Authority of Singapore uses the exchange rate, rather than interest rates, as its primary policy tool. In a statement released on Wednesday, the authority kept the slope, width, and midpoint of its exchange rate policy band unchanged. This marks the first pause in tightening after consecutive rounds of tightening at its April and July meetings. Of the 20 economists surveyed by the media, only 3 predicted this decision, with most having expected the MAS to raise the slope of the policy band, and most respondents also expected the central bank to retain a hawkish bias. After the unexpected decision was announced, the Singapore dollar fell 0.1% to 1.28 per US dollar. Khoon Goh, head of Asia research at ANZ, said: "The effects of the two consecutive rounds of tightening in April and July are still being transmitted, so the central bank believes there is no need for further tightening at this stage. But this does not mean the tightening cycle is over. If upward inflation risks materialize next year, the MAS may tighten policy again." The MAS narrowed its core inflation forecast range for this year to 1.5%-2%, compared with an upper limit forecast of 2.5% at its July meeting; headline inflation is expected to be around 2%.